Executive Search Succession Planning
What is Succession Planning?
Succession planning is a process and strategy that ensures you have the right people in the right jobs to meet current and future goals. CEO succession planning identifies potential CEO successors capable of leading the company. Yet, succession planning applies to all executive positions that are critical for business continuity. It highlights flight risks and potential vacancies. Moreover, it develops leadership development plans to meet those succession needs.
Succession Bench Defined
A succession bench is a list of potential replacements for an executive role or a group of roles. Retained search firms often develop potential successors for the senior executive team. For large technology companies, retained firms also develop succession benches for senior engineering leaders upon whom their innovation depends. This type of succession planning usually takes place every year.
The Long List Begets The Short List
The long list of potential successors is reviewed and refined by senior leadership in partnership with the search firm. The search firm then reaches out to potential successors to determine what kinds of opportunities would motivate them to make a move and to gather deal-making details such as compensation and relocation preferences. In so doing, they request the potential successor’s resume and qualify the candidate. That resulting short list of interested, qualified successors becomes the succession bench. It provides executives ready to step into a critical leadership role should the need arise.
What are Succession Bench Deliverables?
Interested, Qualified Candidates
Succession benches come in several forms. Retained search firms often deliver lists of candidate profiles for each position. Usually, search firms contact potential successors to determine what kind of opportunity would motivate the executives to make a move. They gather compensation requirements and other career preferences — where they want to live, whether they’re open to relocation, and how they work, whether it’s in an office or remotely from home. The search firm then provides reports on each candidate who is interested and qualified.
Executive Mapping and Target Company Org Charts
Retained search firms with a strong investigative research capability also offer organizational charts. It is a form of executive talent mapping of senior leadership teams of competitors and other target companies of interest. They may deliver the profiles as in documents or in online organizational charts (org charts) with biographies and other critical details.
How important is CEO Succession Planning?
CEO succession planning is essential for ensuring a business can go on without its current Chief Executive Officer. Succession planning can also prepare for the potential departure of the CEO, due to illness and even death.
Apple’s Exemplary CEO Succession Plan
For example, Apple’s succession planning prepared for the passing of its iconic founder and Chief Executive Officer Steve Jobs from pancreatic cancer. He was first diagnosed in 2003 and died in October 2011. Apple had time to identify its next successor.
More than a decade after his passing, Apple memorializes its founder on its page Remembering Steve.
The Designated Successor
When longtime Chief Operating Officer Tim Cook became the successor of Steve Jobs at Apple, he replaced one of the most iconic American CEOs to lead one of the world’s biggest technology companies in the world. Yet Apple’s founder had prepared the way by naming COO in 2000 when Steve Jobs’ returned to Apple as CEO. Mr. Cook streamlined Apple’s supply chain, making it more profitable. Twice, he filled in as CEO when Steve was managing his illness — so that when the time came, Tim Cook was ready.
Masterful Stewardship of Apple
Much like Apple products, the very design of Apple’s succession plan is breathtaking. Steve Jobs not only raised up his replacement but also formed an institution to build on the legacy he created. The Apple founder established Apple University to retain and develop top leadership talent and help them think like Steve Jobs. Apple University is led by Vice President and Dean Joel Podolny, the former dean of the Yale School of Management. Tim Cook has stated publicly that succession planning continues at Apple so that the iconic company is prepared when it comes time for him to leave.
CEO Succession Questions for the Board of Directors
- Is the chosen CEO successor still right for the role?
- Is the candidate specification for the CEO successor still applicable?
- Are potential successors prepared to assume the role of CEO?
- Do you have an updated list of external successors, which also enables you to benchmark internal successors?
- Do you have the right leaders on the executive team to ensure your company has the best shot at being successful?
- Is the board aligned and ready to have succession planning conversations to assess immediate and longer-term needs?
External Succession Benches Are Essential
External succession benches provide companies with a current snapshot of the best executive talent available in the marketplace. The information is essential as companies reorganize and restructure to match force with the New Normal. They prepare for unexpected, planned, and forced departures as well as scout talent for new executive roles. They prepare for unexpected, planned, and forced departures as well as scout talent for new executive roles.
COVID-19 Prioritized Succession Even More
The SARS-CoV-2 pandemic has compelled many organizations to review their projections about how resilient they would be in a crisis and to update senior executive succession plans. Many companies have discovered they were not as prepared as they would have liked. That is why succession benches have become a strategic imperative in the age of COVID-19.
Fewer Internal Successors are Available
External succession benches are a necessity because organizational hierarchies have flattened over the years. The number of managerial levels has decreased. With fewer levels, the rungs on the corporate ladder have stretched further apart.
Consequently, when executives climb the corporate ladder, they step into new roles with drastic increases in responsibility and scope. Without intermediate levels to serve as corporate training wheels, it is too easy for new corporate executives to fail. They are simply too junior to become a successor.
External Succession Benches Offer Resiliency
Companies develop resiliency by looking to the outside for top-performing talent. External candidate discovery improves succession bench strength with potential outside candidates. External benches are an effective way to tee up additional potential replacements for senior-level executives and to ensure business continuity.
Welcome to the Next Generation of Succession Recruitment
The Good Search offers succession recruiting services powered by our investigative approach. In fact, we regularly develop succession benches of potential replacements for C-Level executives and critical senior executive roles.
Succession Benches Fascinate Senior Leaders
Clients tell us our succession benches intrigue and delight senior leadership. We believe that’s because they offer so much more than potential successors. In addition to providing business continuity, they shed light, comparatively, on the quality of talent seated at your competitors and other companies of interest. In doing so, they provide invaluable competitive and organizational intelligence. Succession benches also empower you to benchmark senior executive talent. They enable you to top-grade your leadership team, replacing problem leaders with top-performing executives.
Got Questions? Let’s talk.
No search firm is the right firm for every search every time. Yet we make it a practice to listen to what you’re trying to accomplish and we try to help, regardless.